The company had sacked Carol Bartz as its CEO in September 2011. Since then, Yahoo is being run by its board and interim CEO Tim Morse, who has previously been its CFO.
Thompson became president of PayPal in early 2008, after serving as its CTO (Chief Technology Officer) in charge of information technology, product development and architecture.
Before eBay, he worked at Inovant, a subsidiary of Visa formed to oversee global technology for the organisation. He was also CIO of Barclays Global Investors and has worked at Coopers and Lybrand on information technology.
After Bartz's ouster, Yahoo had said it was looking at a range of strategic options, including the possible sale of all or part of the company.
At the same time, Yahoo had also hired Heidrick & Struggles to look for a new CEO.